Category: amicus civitas

Let’s forget about the controversy surrounding SB 320 for the moment and look at the bill itself.  It applies to Title 8, Chapter 2, Article 1, Part 1 that deals with water concerns and has nothing to do with “building design elements” or zoning.

The bill reflects a power struggle between the developers of private government HOAs and constitutional government that’s occurring in many states besides Georgia.  There is the Georgia Constitution and Code (Title 36, Chapter 35, HOME RULE POWERS) that grants municipal powers with certain restrictions.  The Georgia Home Rule code grants restricted freedoms and powers to local government but holds them accountable under the state constitution and laws.  This is not so with HOAs that go by and large unregulated.  The bill makes them more so!

“The  Georgia Constitution specifically provides for “home rule” for counties and municipalities in Georgia. While county home rule is constitutionally prescribed, cities may be granted the same right by the state legislature. In both cases the county or city is authorized to adopt “clearly reasonable ordinances, resolutions, or regulations . . . for which no provision has been made by general law and which is not inconsistent with” the Constitution of Georgia.” (“Home Rule and Ordinances,”  New Georgia  Encyclopedia).

SB 302 supports, in my view, easier HOA approvals by the municipality planning board.  Code section 8-2-5 adds (c)(2), the bill does not “Affect the validity or enforceability of private covenants or other contractual agreements among property owners relating to building design elements.”   The definition of zoning (Section 2 of the bill) is reworked in Code section 36-66-3. The prohibition of the municipality to regulate “building elements” (Section 1 of the bill) is necessary to allow developer a full play as presented by Section 2.

A reading of Section 2 of the bill  allows the perception that it is an attempt to grant HOA developers and their created subdivisions a host of building features and elements, which they can take before the municipality to get rubber stamped.  Planning board approvals are basically granted unless there is citizen opposition, or the subdivision plan violates some aspect of the law.

Guess what? SB 302 puts the law on the developer’s side!

According to CAI, 9 states have adopted UCIOA (Uniform Common Interest Ownership Act), 14 the UCA (Uniform Condominium Act, and 1 state, Pennsylvania,  the UPCA (planned community act)?[i]  Why is it that only 1 state, Kansas,[ii] has adopted the Uniform Common Interest Ownership Bill of Rights Act (UCIOBORA) in 2008?[iii]

The Bill of Rights Act was released as a separate act independent of the basic and initial UCIOA, and from the above state adoptions we can see why.  Apparently, except for Kansas, none of the states care for a Bill of Rights for HOAs!

Why then did the BORA come to pass with only one “buyer”? Allow me to provide some background as to why BORA came about.  In the years preceding its 2008 appearance, there was an outcry for a homeowners’ bill of rights with yours truly, among others, playing an important role in demanding homeowner rights.  Among the demands were Texas attorney David Kahne who co-wrote the AARP Member Bill of Rights in  2006[iv]; and yours truly who argued for homeowner rights to CLRC that was conducting a rewrite of California’s CID act, the Davis-Stirling act (2005 – 2008).[v]

CAI is an avid supporter of UCIOA even to this day, probably because it’s based on the HOA legal scheme and structure introduced in the 1964 Homes Association Handbook.[vi]

Let’s see what pro-HOA state legislators and the national lobbying entity may have felt quite disturbed about its covenants.  (A hint is given when ULU chose to make it free-standing).

UCIOBORA excerpts:

“The Need for a Free-Standing Home Owner Bill of Rights. . . . The reason is that each of these complex Acts has its detractors who have historically blocked adoption of these Acts in any state. . . . [And] of the difficulty drafters in the States may encounter in integrating any new adoption of the existing Uniform Acts with the laws that may already exist in a particular state.  For these reasons, ULC promulgated a free-standing and relatively short Uniform Act that addresses all of the ‘association versus unit owner’ [hints at similarity of ‘management vs employees’] issues touched on during the drafting of the 2008 UCIOA amendments.[vii]

(5) shall establish a reasonable method for unit owners to communicate among themselves and with the executive board concerning the association;

(6) may suspend any right or privilege of a unit owner that fails to pay an assessment, but may not: (B) suspend a unit owner’s right to vote (Section 8(a), powers of HOA). (a) In the performance of their duties, officers and members of the executive board appointed by the declarant shall exercise the degree of care and loyalty to the association required of a trustee (Section 9, Executive Board).

(b)(5) determine the qualifications, powers, duties, or terms of office of executive board members (Section 9).

(a)(4) specify the powers the executive board or officers may delegate to other persons or to a managing agent (Section 10, Bylaws);

(Section 11, Owners meeting). (c) The notice for any meeting must state the time, date, and place of the meeting and the items on the agenda, including: (1) a statement of the general nature of any proposed amendment to the declaration or bylaws;

(f) The declaration or bylaws may allow for meetings of unit owners to be conducted by telephonic, video, or other conferencing process, if the alternative process is consistent with Section 12(g).

(g) Except as otherwise provided in the bylaws, meetings of the association must be conducted in accordance with the most recent edition of Roberts’ Rules of Order Newly Revised.

(Section 12, Executive Board meetings). (g) Unless the declaration or bylaws otherwise provide, the executive board may meet by telephonic, video, or other conferencing process if: (1)   the meeting notice states the conferencing process to be used and provides information explaining how unit owners may participate in the conference directly or by meeting at a central location or conference connection; and (2)   the process provides all unit owners the opportunity to hear or perceive the discussion and to comment as provided in subsection (d).

(Section 14, Voting). (d) Unless prohibited or limited by the declaration or bylaws, an association may conduct a vote without a meeting. In that event, the following requirements apply: (3) The ballot must set forth each proposed action and provide an opportunity to vote for or against the action.”

OK, where are we?  The sampling above is not in the same spirit and intent as our constitutional and properly named, Bill of Rights.

“THE Conventions of a number of the States having at the time of their adopting the Constitution, expressed a desire, in order to prevent misconstruction or abuse of its powers, that further declaratory and restrictive clauses should be added: And as extending the ground of public confidence in the Government, will best insure the beneficent ends of its institution.”

On the other hand, UICOBORA addresses the governing documents as if they were the HOA’s constitution in its attempt to bring more fairness and justice to homeowner issues and complaints. The Uniform Law Commission (ULC) had good intents.   However, the two BOR are like apples and oranges. UCIOBORA should be more aptly named Homeowners Rights and Responsibilities. Instead appears to look as if it were supporting a genuine BOR for HOA homeowners based on our Constitution.

Furthermore, don’t get confused with CAI’s Rights and Responsibilities for Better Communities,[viii] which consists of “ought to” advice and prescriptions for  better communities, with nothing that you can go to court on.  Excerpts:

“Homeowners have the right to: Honest, fair and respectful treatment by community leaders and managers, Receive all documents that address rules and regulations governing the community association,

“Homeowners have the responsibility to: Read and comply with the governing documents of the community, Treat association leaders honestly and with respect, Vote in community elections and on other issues, Pay association assessments and charges on time.

“Community leaders have the right to: Respectful and honest treatment from residents., Receive support and constructive input from owners and non-owner residents;

“Community leaders have the responsibility to: Conduct open, fair and well-publicized elections, Conduct open, fair and well-publicized elections, Encourage events that foster neighborliness and a sense of community.”

 

The good intentions of the Uniform Law Commission were found unacceptable by all the states except Kansas. Nationally, we have UCIOA, the Uniform Common Interest Act replacement to America’s Constitution with a deceptive bill of rights for homeowners as contained in UCIOBORA.  Yet, HOA-LAND[ix] continues to grow and represents a secession from the Union without a shot being fired. These subdivisions and condos portrayed as “communities” function outside the US Constitution and have substituted their governing documents as the community’s supreme law of the land.

by: George K. Staropoli

 

References

[i] “CAI State Advocacy, Uniform Acts.”

[ii] “Kansas Legislative Research Department”, Common Interest Statutes, March 2018).

[iii]  UCIOBORA.

[iv] AARP HOA Bill of Rights, David Kahne.

[v] See California CLRC proposal for state assistance to HOAs, Homeowner Rights are an important issue for California’s CLRC, CLRC proposes changes to HOA laws without a bill of rights. Also involved in the quest for a CA Bill of Rights were Donie Vanitzian (see Staropoli letter to  CLRC) and Elizabeth McMahon (“In 1997, Elizabeth McMahon of AHRC filed a Homeowners Bill of Rights with the California Law Review Commission looking into revising California’s HOA statutes); both are no longer with us.

[vi] See Analysis of The Homes Association Handbook.

[vii] Supra n. iii, Prefatory Note, page 1.

[viii] CAI’s Rights and Responsibilities.

[ix] Definition of HOA-LAND:  HOA-Land is a collection of fragmented independent principalities within America, known in general as “HOAs” that are separate local private governments not subject to the constitution; and collectively constitute a nation within the United States.

Is a homeowner entitled to compensation for the eminent domain taking of the HOA’s common area? The Constitution states a taking requires compensation, but since the common areas are owned by the HOA, it gets the compensation. What about the homeowner whose property value – market value – drops because of the new common area use by the state? Now, no longer so desirable.

The ruling by the Kansas Supreme Court in Creegan[1] held that the homeowner not only has CC&Rs contractual rights, but property rights also, and can claim inverse condemnation as it’s called[2]. While the defendant was referred to as a subdivision, it had all the criteria that applies to all HOAs — common areas and covenants that run with the land under equitable servitudes real estate law.

So, if an agency takes common area property for a ditch, for a wall or for road expansion and property values drop, the homeowner may have claims for compensation.

Equally important, but not addressed in Creegan, what about a “taking” by the HOA itself, either of common properties or of the homeowner’s private property? Most common would be a change in the use or purpose of the common property, like removing a park or a tennis court, etc. The more unjust taking involves the HOA itself putting up a wall, or ditch, or the expansion of an administrative building. Or the removal of trees or a fence on your property, which are all permitted by the CC&Rs? This does happen. But the homeowner is not compensated for this “taking.”

The HOA and the courts treat this as a private matter all agreed to by the homeowner who unwittingly gave the HOA broad powers when they “signed up.” They hide behind the fact that they are obeying the law. But the law can be unjust, as it is, favoring the HOA in what amounts to an adhesion contract. My response to this view is well stated by a line in the TV series, Madam Secretary, “You can technically obey the law and still be at fault. That’s ethics.”

HOA “eminent domain” is an example of a loss in constitutional protections due to the private CC&Rs contractual nature. It’s another example of special laws to protect the HOA entity, violating the 14th Amendment against the unequal protection of the law and state constitutions.[3]

HOA eminent domain has not been challenged in the courts as far as I know. It should be!

References

[1] Creegan v. State of Kansas, 391 P.3d 36  (Kan. 2017).

[2] “inverse condemnation – n. the taking of property by a government agency which so greatly damages the use of a parcel of real property that it is the equivalent of condemnation of the entire property. Thus, the owner claims he/she is entitled to payment for the loss of the property (in whole or in part) under the constitutional right to compensation for condemnation of property under the government’s eminent domain right.” Law.com.

[3] For example, Arizona Constitution, Article 2, Section 13. “Equal privileges and immunities. Section 13. No law shall be enacted granting to any citizen, class of citizens, or corporation other than municipal, privileges or immunities which, upon the same terms, shall not equally belong to all citizens or corporations.”

 

The following was sent as a Request to Speak to the Arizona House GOV committee this morning (restricted to 250 characters). HB 2374 seeks to overcome an adverse court ruling holding Sun City recreational center an HOA.  It is an intentional government interference into private contracts to  benefit the HOA.

Dear House Government Committee Members:

I strongly oppose HB 2374 as government intrusion into a private entity under a contractual arrangement.

Granting RCSC, and all such arrangements designed to favor the HOA scheme, not subject to the Planned Communities Act is unconstitutional. It violates the Arizona Constitution, Art. 2, Section 13. “No law shall be enacted granting to any citizen, class of citizens, or corporation other than municipal, privileges or immunities which, upon the same terms, shall not equally belong to all citizens or corporations.”

The bill intentionally negates the recent Sept. 4, 2019 Maricopa Superior Court’s summary judgment ruling in Anderson et al v. RCSC, and not appealed, that RCSC is subject to the Act.

“In conclusion, all Sun City residential property owners are obligated to pay assessments that RCSC uses to defray the costs and expenses it incurs owning and operating recreational facilities in Sun City and, as such . . . . RCSC is subject to the Act for the purposes of plaintiffs’ instant lawsuit.”

Aside from city/state “recreation centers” I can only find Sun City and Sun City West using this arrangement of recreation centers, both are Del Webb developments. This is a miniscule class of entities in view of the thousands of HOAs in Arizona. The bill cleverly redefines “association” to exclude entities whose “SOLE PURPOSE OF SUPPORTING RECREATIONAL ACTIVITIES IN A REAL ESTATE DEVELOPMENT.” That applies to only the RCSCs of Sun City and Sun City West.

The bill flies in the face of political claims to support the people. It favors de facto private government HOAs and is unquestionably unconstitutional. We are a democracy and the people are to be protected, not corporations that deny constitutional rights of equal protection of the law (14th Amendment). Do not pass this bill.

Respectfully,

George K. Staropoli

To All US Policymakers:

Are you aware of the Jan-Feb AARP Bulletin that contains a highly critical article on HOAs?  The Bulletin article, on page 8 under “Home Wars” (not yet available on AARP’s web site), calls attention to the plight of seniors who face harsh treatment when they fall behind in making HOA payments.

An excellent article hitting home on one of my 6 substantial issues of HOA unconstitutionality — draconian foreclosure[i] and the influence of attorneys.  Foreclosure is a punishment!  It is common that more than 50% of the foreclosure money goes into hands of the attorney and not the HOA. Yet, CAI spokesperson, SVP Dawn Bauman, is quoted as saying, “this type of problem is rare.”

The national homeowner associations (known as HOAs, PUDs, CIDs, POAs) lobbyist, Community Associations Institute (CAI), has been increasing its lobbying influence on Congress and The White House, claiming that it speaks for the associations and the homeowner members.  This is not true! It is a business trade group claiming to speak for consumers of the services provided by its members, the attorneys and HOA management people. It does not have any HOAs as members and is not permitted to have HOAs, per se, as a member.

Policymakers have openly accepted this propaganda, failing to properly vet (“to check someone’s character or reputation to find out if they are suitable for a particular job”) CAI. They have ignored the opposing legitimate and valid arguments presented by credentialed homeowner advocates.  These advocates include Prof. Evan McKenzie (UIC) who wrote the seminal 1994 book, Privatopia: Homeowners Associations and the Rise of residential Private Government, in which he wrote,

“Taken as a whole, these [HOA] powers permit the regulation of a wider range of behavior than any within the purview of a public local government.”

In his 2011 sequel, Beyond Privatopia: Rethinking Residential Private Government, McKenzie acknowledges the  contributions of several advocates, mine included.  In regard to democracy in HOAs, McKenzie wrote:

“The notion that individual owners agreed among themselves to perform these services for each other, and subsequent owners took over from them, is entirely fictional.” 

He was challenging the myth that HOAs are highly democratic, when in fact the homeowners were handed an adhesion contract — the take it or leave CC&Rs

Then there are internet publishers such as Deborah Goonan[ii] and yours truly[iii] whose websites contain posts/papers challenging CAI’s propaganda, well documented using CAI’s own communications, court cases, and state laws.

Yet, the policymakers have failed to properly vet CAI by ignoring the criticisms by homeowner advocates of the HOA legal scheme and their arguments of abuse by rogue HOAs in favor of the national lobbyist, CAI.  This must stop!  For your convenience, here are summaries of my 6 issues of substance, taken from the table of contents of HOA Common Sense: rejecting private government, that the policymakers have long ignored:

Consent to be governed, No. 4
Democratic elections, No. 5
Fair and just hearings, No. 6
HOA Boards can do no wrong, No. 7
Draconian punishment and intimidation, No. 8
HOA Governments in fact, No. 9

I urge you to explore the arguments made by homeowner rights advocates and seek responses from CAI. Then judge for yourself if you have been given a run-around.

 

Respectfully submitted,

George K. Staropoli, Founder

GKS profile:

 

References

[i] See Draconian punishment and intimidation, No. 8.

[ii] Independent American Communities.

[iii] HOA Constitutional Government; Citizens for Constitutional Local Government.